United States District Court, E.D. California
McGREGOR W. SCOTT United States Attorney.
M. ESPINOZA KEVIN C. KHASIGIAN Assistant U.S. Attorney.
UNITED STATES' REQUEST TO EXTEND THE DEADLINE TO
SUBMIT A JOINT STATUS REPORT FROM NOVEMBER 12, 2019 TO
JANUARY 9, 2020
A. Mendez, United States District Court Judge.
United States submits the following Request to Extend the
Deadline to file a Joint Status Report from November 12, 2019
to January 9, 2020.
March 18, 2019, the United States filed a civil forfeiture
complaint in rem against more than sixty bank
accounts, over $1.8 million in U.S. currency, prepaid flight
hours with a private jet company, a luxury box with a
professional sports team, and various items of jewelry
(“defendant assets” or “In Rem
Defendants”) connected to fraud and money laundering
crimes in the Eastern District of California and other areas.
As described below, the bank accounts are associated with DC
Solar and its related investment funds, which the United
States alleges are involved in, and contained proceeds of, a
Ponzi scheme orchestrated through a tax equity investment
fraud. All known potential claimants to the defendant assets
were served in a manner consistent with Dusenbery v.
United States, 534 U.S. 161, 168 (2002) and the
applicable statutory authority. Furthermore, public notice on
the official internet government forfeiture site,
www.forfeiture.gov, began on May 4, 2019, and ran
for thirty consecutive days, as required by Rule
G(4)(a)(iv)(C) of Supplemental Rules for Admiralty or
Maritime Claims and Asset Forfeiture Actions. See
Dkt. 4. A Declaration of Publication was filed on June 6,
2019, which set forth, among other items, that publication on
the government's forfeiture website was complete on June
2, 2019. See Dkt. 9.
case is related to three other cases filed in the Eastern
District of California: two civil cases, United States v.
725 Main Street, Martinez, California, et al., Case
2:19-CV-00247-JAM-DB and United States v. 5383 Stonehurst
Drive, Martinez, California, et al., Case
2:19-cv-00636-JAM-DB; and one recently filed criminal case,
United States v. Ronald Roach, et al.,
United States has provided notice to all potential claimants
pursuant to law. The United States served copies of the
complaint documents on all interested parties, including
financial institutions, a professional sports franchise, a
private jet operator, investors in the tax equity funds, and
the LLCs and individuals listed as signors on the seized bank
accounts. The United States specifically served copies of the
complaint documents on the LLCs through their registered
agent for service of process, as listed on the California
Secretary of State's website. Further, the government
served copies of the complaint on the principals of DC Solar,
Jeffrey and Paulette Carpoff. Lastly, the government has
provided notice of this action to any entities or individuals
that may have a security interest in the accounts, such as a
certificate of deposit required as part of a larger financial
loan package extended to DC Solar.
parties have so far appeared in the case. First, the
principals of DC Solar and the LLCs associated with many of
the In Rem Defendants, Jeff and Paulette Carpoff,
filed claims as to each of the eighty-seven In Rem
Defendants. See Dkt. 6-7. Second, NetJets, through
their wholly-owned subsidiaries,  filed claims concerning the
prepaid flight shares purchased by the Carpoffs with alleged
fraud proceeds. Dkt. 12-14. Third, East West Bank and Solar
Eclipse Investment Fund XXXV, LLC filed claims to In
Rem Defendant Approximately $9, 004, 531.62, which was
seized from the Investment Fund's bank account during the
government's law enforcement operation on December 18,
2018. Dkt. 15-16. East West Bank states that it was an
investor in Solar Eclipse Investment Fund XXXV, LLC. Dkt. 15.
The Solar Eclipse Fund and East West Bank filed answers.
other party has filed an answer in this case. However, based
on the claimants' requests for additional time to review
the allegations-in the civil complaint as well as the
criminal information and plea agreements-and potential
privilege issues and other defenses, and given the lengthy
facts and complicated issues in this case, the United States
has agreed to their requests for more time. The answers are
currently due on December 10, 2019.
several potential tax equity investor-victims and financial
institutions have requested extensions of time to file claims
in this case since the filing of the criminal action against
defendants Ronald Roach and Joe Bayliss. For similar reasons
underlying the agreement to extend the time to file an
answer, the United States granted each request for an
extension of time and those entities and institutions
currently have until December 9, 2019 to file a claim in the
allow the above individuals, entities, and investors
sufficient time to file claims and/or answers, as well as to
research the issues raised by the facts alleged in the
Complaint and recently filed criminal pleadings, the United
States seeks to continue the deadline to file a Joint Status
Report from November 12, 2019 to January 9, 2020 (or to
another date the Court deems appropriate).
there is good cause to extend the deadline to file a joint
status report in this case from November 12, 2019 to January